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    TaxPlanner Posts: 3, Reputation: 1
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    #1

    Oct 16, 2008, 01:49 PM
    Tax planning for dual residency in AL and LA
    How are taxes filed when there are two residences? My husband does not work and will live mainly in Alabama in a home that we own there. He has income from investments (jointly owned by me). I will live in Louisiana (renting an apartment) and will be employed there. I will also be collecting state pension income from Alabama (not taxed in Alabama) which will be deposited in an Alabama bank account and used to fund the expenses there. Both of us will spend time at each residence periodically.

    We file federal income tax as married filing jointly. However, when I review the Louisiana income tax info, it says that I must select the same filing status as federal. Since we have reported income from Alabama, we will file a return in Alabama as well. Does this mean that we will be taxed on the same income (investments, etc.) from both states? Is there anyway to avoid being taxed on the Alabama pension in LA (I am not 65)?
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    AtlantaTaxExpert Posts: 21,836, Reputation: 846
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    #2

    Oct 16, 2008, 02:37 PM
    If you are considered to be a Louisiana resident, ALL of your income is subject to LA taxes. If you can make the case that you just work in LA and livig in Alabama, then the Alabama-sourced income will NOT be subject to LA taxes.

    I would have to thoroughly research Louisiana tax law to be sure, but I am be willing to bet that Louisiana takes the position that if you live in LA for more than 50% of the calendar year, you are in fact a LA resident.

    Most states would take that position because you maintain an apartment in Louisiana.
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